Jordan v. Lyles, 455 S.W.3d 785 (Tex. App.—Tyler 2015, no pet.).
Agent was accused of breach of fiduciary duty by
placing a significant portion of Principal’s property into accounts
naming her as a pay on death beneficiary or giving her survivorship
rights.
The appellate court first addressed whether
Principal’s heirs had standing to bring a suit for breach of fiduciary
duty. The court explained that normally an heir lacks
standing because the principal’s personal representative usually has the
exclusive right to bring the suit. However, because
Principal’s estate was handled with a muniment of title, there was no
executor appointed and thus the heirs had standing.
The jury awarded the heirs damages for breach of
fiduciary duty and tortious interference with inheritance rights.
However, the court granted Agent’s motion for a judgment
notwithstanding the verdict. Agent argued that the
court was correct because the transactions were fair to Principal.
However, Agent was unable to prove that she specifically
discussed the transactions with Principal and informed him of the
material facts relating to them. Agent unsuccessfully
claimed she was mere a scrivener when she competed various actions for
Principal rather than acting in a fiduciary capacity.
Accordingly, the appellate court reversed and reinstated the jury
verdict.
Moral: An agent owes fiduciary duties to
the principal at all times, even when technically not acting under the
authority granted by the power of attorney. Thus, an
agent should act with the utmost degree of loyalty to the principal and
avoid being involved in any transaction which could potentially benefit
the agent.